Correlation Between Moleculin Biotech and Marker Therapeutics

Can any of the company-specific risk be diversified away by investing in both Moleculin Biotech and Marker Therapeutics at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Moleculin Biotech and Marker Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Moleculin Biotech and Marker Therapeutics, you can compare the effects of market volatilities on Moleculin Biotech and Marker Therapeutics and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Moleculin Biotech with a short position of Marker Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moleculin Biotech and Marker Therapeutics.

Diversification Opportunities for Moleculin Biotech and Marker Therapeutics

-0.08

Correlation Coefficient

Moleculin Biotech  Marker Therapeutics

Good diversification

The 3 months correlation between Moleculin and Marker is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Moleculin Biotech and Marker Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marker Therapeutics and Moleculin Biotech is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Moleculin Biotech are associated (or correlated) with Marker Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marker Therapeutics has no effect on the direction of Moleculin Biotech i.e., Moleculin Biotech and Marker Therapeutics go up and down completely randomly.

Pair Corralation between Moleculin Biotech and Marker Therapeutics

Given the investment horizon of 90 days Moleculin Biotech is expected to under-perform the Marker Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Moleculin Biotech is 1.4 times less risky than Marker Therapeutics. The stock trades about -0.07 of its potential returns per unit of risk. The Marker Therapeutics is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  262.00  in Marker Therapeutics on October 9, 2024 and sell it today you would earn a total of  50.00  from holding Marker Therapeutics or generate 19.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Moleculin Biotech  vs.  Marker Therapeutics

Moleculin Biotech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Moleculin Biotech has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Marker Therapeutics

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Marker Therapeutics are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak forward-looking signals, Marker Therapeutics reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Moleculin Biotech and Marker Therapeutics

The main advantage of trading using opposite Moleculin Biotech and Marker Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moleculin Biotech position performs unexpectedly, Marker Therapeutics can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Marker Therapeutics will offset losses from the drop in Marker Therapeutics' long position.

The idea behind Moleculin Biotech and Marker Therapeutics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.